Principal Financial Group no longer will provide medical insurance and has arranged for UnitedHealthcare to handle renewals.
The Principal's medical insurance business has been performing well financially, but the company's retirement and asset management businesses have grown more quickly, and the relative size of the medical insurance business has been declining. Shutting down the medical insurance business should free more than $100 million in capital, according to the National Underwriter.
"The medical business continues to be one that undergoes rapid change, which would mean investing additional capital into the business to be able to offer competitive products. For us, that just does not make sense," Principal Chairman, President and CEO Larry Zimpleman said in a statement.
Sales will cease and the renewal process with UnitedHealthcare will begin immediately to be completed within 36 months, subject to applicable federal and state law requirements, Principal said. As its medical insurance customers reach their plan renewal dates, UnitedHealthcare will enroll them in a comparable plan. Meanwhile, their current benefits remain in effect, UnitedHealth officials said in a statement.
To learn more:
- read the National Underwriter story
- read the UnitedHealth statement
- read the Principle statement